Podcast
Questions and Answers
What is the primary reason why rejecting subagency might be detrimental to a client's interests?
What is the primary reason why rejecting subagency might be detrimental to a client's interests?
- It requires the client to pay a higher commission to the real estate agent.
- It prevents the client from receiving informed consent regarding the agency relationship.
- It creates an undisclosed dual agency situation, which is illegal in all states.
- It can prevent the property from being listed on MLS, limiting its visibility and potential buyers. (correct)
What does Informed Consent refer to in the context of dual agency?
What does Informed Consent refer to in the context of dual agency?
- A written agreement where both the buyer and seller acknowledge their understanding of dual agency. (correct)
- A verbal agreement where both the buyer and seller agree to a dual agency arrangement.
- An agreement from the client to be represented by the agent without any prior disclosures about dual agency.
- A situation where the agent acts as a dual agent without the explicit knowledge of both the buyer and seller.
Which of the following is NOT a benefit of a dual agency arrangement for a real estate agent?
Which of the following is NOT a benefit of a dual agency arrangement for a real estate agent?
- The agent can save time by managing both sides of the transaction.
- The agent can establish closer relationships with both the buyer and seller. (correct)
- The agent can potentially promote a faster closing of the transaction.
- The agent receives the full commission without having to share it.
What is a designated sales agent in the context of dual agency?
What is a designated sales agent in the context of dual agency?
What is the consequence of failing to disclose a dual agency relationship in New York State?
What is the consequence of failing to disclose a dual agency relationship in New York State?
What happens to the fiduciary responsibilities of an agent to a Principal once the transaction is finalized?
What happens to the fiduciary responsibilities of an agent to a Principal once the transaction is finalized?
When is a dual agency situation permissible in a real estate transaction?
When is a dual agency situation permissible in a real estate transaction?
What is the term for the fee an agent receives for referring clients or services to another agent?
What is the term for the fee an agent receives for referring clients or services to another agent?
Which of the following is NOT a fiduciary duty owed by an agent to their principal?
Which of the following is NOT a fiduciary duty owed by an agent to their principal?
What type of agency is created by a written or oral agreement between the principal and the agent?
What type of agency is created by a written or oral agreement between the principal and the agent?
What is an agreement between members of a trade to exclude other members from fair participation in the trade called?
What is an agreement between members of a trade to exclude other members from fair participation in the trade called?
What is the principle that prevents a person from asserting something contrary to what is implied by a previous action or statement?
What is the principle that prevents a person from asserting something contrary to what is implied by a previous action or statement?
Which of the following is NOT considered a form of anticompetitive business practice?
Which of the following is NOT considered a form of anticompetitive business practice?
What does the term 'informed consent' refer to in real estate?
What does the term 'informed consent' refer to in real estate?
What does it mean for a real estate firm to have an 'in-house' dual agency situation?
What does it mean for a real estate firm to have an 'in-house' dual agency situation?
Which of these scenarios is an example of the fiduciary duty of obedience?
Which of these scenarios is an example of the fiduciary duty of obedience?
Flashcards
Dual Agency
Dual Agency
A situation where a real estate agent represents both the buyer and seller.
Informed Consent
Informed Consent
Agreement granted after all relevant facts are disclosed.
Undisclosed Dual Agency
Undisclosed Dual Agency
Agent represents both parties without consent, which is illegal.
Disclosure Form
Disclosure Form
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Designated Sales Agent
Designated Sales Agent
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Consent Withdrawal
Consent Withdrawal
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Referral Commission
Referral Commission
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Fiduciary Responsibilities
Fiduciary Responsibilities
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Advance Consent to Dual Agency
Advance Consent to Dual Agency
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Confidentiality
Confidentiality
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Cooperating Agent
Cooperating Agent
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Disclosure
Disclosure
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Loyalty
Loyalty
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Obedience
Obedience
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Study Notes
Real Estate Agency and Dual Agency
- MLS Listing: Listing a property on the Multiple Listing Service (MLS) automatically makes the buyer's agent a subagent to the seller, creating a dual agency.
- Client Rejection: Rejecting dual agency may prevent the property from being listed on the MLS, potentially reducing visibility and limiting the sale price and thus not in the best interest of the client.
- Informed Consent: Both buyer and seller must provide written consent for dual agency, detailing the known facts and risks of the transaction in advance.
- Undisclosed Dual Agency: Illegal in all states, this situation involves the agent acting as both buyer and seller's agent without their knowledge or consent.
- Dual Agency Consent: Both buyer and seller need written consent for a dual agency; otherwise, the NY Real Property Law is violated.
- Dual Agent Commission: The dual agent receives the full commission, which may be a motivation to reduce the commission to increase the probability of the transaction. This saves time in the transaction.
Disclosure and Informed Consent
- Disclosure Form: A written form disclosing dual agency risks and benefits informs the client.
- Withdrawal from Dual Agency: If either party changes their mind about dual agency, they can withdraw their consent.
- Designated Sales Agent: In "in-house" dual agency situations, a firm can appoint different agents to only represent the seller or the buyer.
Agent Responsibilities and Termination
- Referral Commissions: Agents can receive referral commissions, with disclosure to the client.
- Fiduciary Responsibilities: Agents' fiduciary responsibilities to the client end when the transaction is completed, but confidentiality regarding shared information remains.
- Accountability: An agent needs to be responsible in any transaction.
- Advance Consent to Dual Agency: This means that the seller or buyer agrees to dual agency in advance of the transaction.
- Confidentiality and Loyalty: Agents must maintain confidentiality and act in a way that places the client's interests above all others ( including themselves).
- Cooperating Agent: An agent who helps with the sale of a property (e.g., subagent, buyer agent, dual agent).
Legal Principles and Practices
- Disclosure Requirements: Disclosure must take place regarding potential defects or problems with the property.
- Estoppel: This is a principle that prevents someone from asserting something contrary to their earlier actions or statements.
- Expressed Agency: The formal and agreed-upon association between principal and agent.
- Group Boycott: An agreement among members to exclude others.
- Market Allocation: Members agree to refrain from competition in certain market areas.
- Obedience: An agent's duty to follow the client's instructions in good faith.
- Price-Fixing: A conspiracy to set prices for services or goods.
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